Homeowners are disputing their property tax assessment. After all, a property tax assessment is nothing more than an viewpoint of value that should be double checked by you. By disputing into the tax assessment process, you will make the tax assessors more accountable and the aggregate methodology will become fairer.
Contrary to popular belief, tax assessors hardly ever make an assessment on a home. That job is bid out on a bid basis to professional area blanket appraiser businesses who determine market value for the homes in a given area and come up with a valuation.
The appraising party has to make a profit on their per home bid price and have to allocate a portion amount of their time per valuation. They blanket large areas and make their conclusion of value rather quickly because of money and time restraints. Inaccuracies often occur. Consumer Reports gives the error rate equals 40%.
To confuse the conundrum, the market value of a house is divide by a sales ratio and that number is given as the assessment. Everything of property assessments depends on the sales ratio. This can be called, depending on the jurisdiction, assessment level, director’s ratio, the average ratio, the common level of 100% of true value, RAR (residential assessment ratio) or the equalization rate (which may not always be equivalent to the sales ratio).
THE FORMULA FOR MARKET VALUE (WHEN ASSESSED VALUE IS EMPLOYED): The retail cost of a property = the “assessed value” that the county tax assessor came up with DIVIDED by the sales ratio. That looks like smoke and mirrors to a lot of individuals.
Many people get snowed by this cost method and don’t know what the valid score is. The reality of what the value that the assessor places on their home does not register correctly.
Take for example, if the sales ratio for an area is pegged at 70%, a $500,000 dollar home should be assessed at $350,000. So, if the homeowner sees that their home is assessed at $420,000 he/she might be thinking they are getting a super deal, but in reality they are getting tricked. Assessed value nomenclature muddies perception.
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